Warehouse Inbound and Storage

Warehouse Inbound and Storage

Chen Zhou Fall, 08

4/14/2005

Major operations in a DC or warehouse

Receiving Function

Unload/stage Inspect Put Away

Storage Function

Shipping Function

Load Pack Order Pick

Cross Dock

Avg Operation Cost 55%

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Receiving

Tasks

„ Check, inspect, unload, Record, stage, re-palletize

Facilities

„ Docks, lift trucks, forklift, mobile conveyors, cart,

„ Computer terminals, bar code printer Decisions „ Schedule of arrivals „ Priorities „ Staging „ Problem handling

Cost ~ 10% of operation cost

Putaway

„ Move goods storage locations Facility

„ Pallet truck „ Lift truck

„ … more in following slides Decisions

„ Where „ When „ Equipment

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Counter-balanced forklift

Can stack two up Can go high

Gasoline, propane, natural gas, electric

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Narrow Aisle straddle trucks

Require 7’ - 8’ aisles Capacities available are 3000# & 4000#

Load must be uniform Load must fit between outriggers

Bottom beam in rack recommended Typically custom built Require floor with high flatness, especially when heavy loads are going high

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Turret truck

¾ Requires 48” - 72” aisle ¾ 25’ & higher

¾ Up to 4000# capacity

¾ Ability to be maneuvered in & out of aisle

¾ Services both sides of aisle ¾ Full pallet put away ¾ Full or partial pallet picking ¾ Loads must be positions at the

aisle by other equipment ¾ Demand high quality floors

Storage and Handling

Chen Zhou Summer, 08

4/14/2005

Storage

„ Hold inventory Methods

„ Floor, floor stacking „ Pallet rack

„ Gravity flow rack, push back „ Bin shelving Objectives „ Space utilization „ Response „ Labor cost Decisions

„ Floor, equipment, slotting, How to measure the efficiency of storage?

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Warehouse parameters: pick face

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Warehouse parameters: sku density

„ Floor: 30 foot length, 4 skus. Sku density = 4/30 = 0.133

In bins

„ Rack: 12 foot, 360 skus, Sku density = 360/12 = 30

The higher the sku density, the higher the potential for shorter travel in order picking

What do we loose with higher sku density? Volume

Warehouse parameters: pick density

„ In a large warehouse, the distance from the I/O to the far most

corner is 400 meters. Each pick is for one pallet which is uniformly distributed throughout the warehouse. The average pick density is 1 per 200 meters traveled.

„ In a picking zone that is 50 meters long, a picker on an average

picks 100 skus in each sweep, the average pick density is 2 skus per meter traveled.

Is higher density good?

How to gain higher pick density? A major design and operation challenge.

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Storage: floor stacking

No storage equipment is required

Items must be able to support the weight: special packaging may be required

Can achieve good space utilization with limited SKUs

Does not support FIFO Low sku density

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Floor storage with tier rack

racks

Often used for storage centric applications

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Pallet racks and bin shelving

Gravity flow racks

Allows higher sku density while maintain high volume for each sku

YOU may have seen gravity flow storage in supermarket: milk

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Effectiveness of pallet flow racks

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Vertical carousels

Small items Valuable items

AS/RS with stacker crane

AS/RS Miniload

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Space requirements estimates

Recall 3PL for home appliance company? Throughput per day

„ Receiving 50 - 75 truckloads, Assume 2,560 ft3/truck Holds 4 weeks of inventory

Little’s Law „ WIP = TH * CT

WIP = 75 * 2,560 ft3_{/day * 4 weeks * 5.5 days/week = 4,224,000 ft}3

Assume stacking 20 ft high, space for storage = 211,200 ft2

Space utilization: 50 (70%), plus aisles, etc.

Reality: 657,000 ft2_{(14 football fields), 140,000 unit storage}

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Slotting priority: cubit-per-order index (activity ratio)

What factor (s) should we consider to prioritize the slotting with known economic terrain (contours)? Pick (restock) frequency: fast movers should occupy better locations.

Space requirement for the item. This may not be obvious.

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E.g.

Skus A and B have same pick frequency of 10/day. A takes 2 pallet slots and B takes 1 slot (can be due to lower inventory turns or smaller cases). Which one should be placed in more convenient location?

A A B I/O B A A I/O 35 5 . 2 * 10 1 * 10 2 1 = + = =

∑

∑

Does this make sense

The objective is to visit closer cell more frequently, regardless of what is in there.

p_i pick frequency picks/week v_i vol in storage ft3

The cell visit frequency is equal to For the example: AR_A = 10/2=5, AR_B= 10

A A B I/O B A A I/O 35 5 . 2 * 10 1 * 10 2 1 = + = =

∑

∑

v

p

=

COI)

(or

Ratio

Activity

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What can impact the storage requirements

Replenishment frequency

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E.g.

Top 6 items has steady daily demand in a small warehouse using dedicated storage. All orders consists of single item and there is no batching. The items are stored in pallets on shelves. Someone used EOQ model to decide the replenishments frequencies. Please find assignment priority. Let 1 week = 5 days.

A B C D E F

Daily demand (cases) 200 100 1000 30 50 50

Cases/pallet 50 50 500 30 10 25

Replenishments Weekly Weekly Bi-wkly Daily Weekly Bi-wkly

Daily demand (pallets) 4 2 2 1 5 2

Space required (pallets) 20 10 20 1 25 20

AR 10 10 50 30 2 2.5

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Dedicated vs. randomized (shared) storage

Dedicated storage is more convenient

Shared storage provides higher storage efficiency Hybrid

„ Dedicated zones but shared within zones „ Dedicated in pick and and shared in reserve

∑

=

v

V

max

:

storage

Dedicated

∑

=

v

V

max

:

storage

Shared

Comparison of randomized/dedicated

Randomized takes less storage requirements since averages variability across products

Which provides higher pick density?

„ If all skus have similar activity ratio, the smaller space in

ramdomized storage should lead to higher pick density

„ If activity ratios vary a lot, the frequent visit to convenient

locations in dedicated storage can lead to higher pick density Hybrid - zone based storage

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Inbound and storage summary

Inbound operations Storage methods

Equipment and handling Storage metric

Slotting priorities

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Questions

What are the important operations in a warehouse or DC? What are the pros and cons of high sku density?

What can be used to achieve high sku density while maintain volume?

Why DCs often use different equipment for transport and rack handling?

What factors affect slotting priorities?

Order processing and order picking

Fall 08 Chen Zhou

Order picking

Most demanding: ~ 63% of operating costs in a typical warehouse, survey by the Warehouse Education and Research Council. It was identified as #1 area for improvement

Become more significant due to emphasis on just-in-time (JIT), cycle time reduction, quick response, and marketing strategies such as micro marketing and megabrand strategies

„ Smaller orders more frequently and more accurately

„ More stock keeping units (SKUs) be available for the customers.

What is involved to ensure high efficiency

„ Layout and storage strategies

„ Slotting

„ Order processing

„ Order picking system design

„ Order picking operational specifics

„ Sequencing „ Batching „ …

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Order processing

Form of pick list: sequenced labels

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Other form of pick list

Data table for PLC for pick to light Sequenced voice instructions to pick to voice (later)

Instructions to automated systems

Issues in order processing

„ Minimize travel (or other handling) Subject to

„ Throughput „ Cycle time „ Line balancing

„ Time window, batch to waves

„ Day in a week

„ Departing time

„ Items to pass to other DCs

„ …

WMS normally support this function. „ It requires customization and adaptation

Order picking

Chen Zhou Summer 08

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What is involved in order picking

Travel Search Pick (sort) Put (sort)

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What affects order picking

Storage

„ Type of storage affects sku density „ Sku density affect pick density „ Slotting affect total travel Order picking system design

„ One at a time

„ Batching in various ways „ … Operations „ Sequencing „ Schedule „ … Technologies

„ Pick to light can reduce search time and improve accuracy

Parameters of orders

Number of line items Number of items in a line

Size and weight of an item

„ Pallet

„ Cases (cartons) „ Break pack

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Picking strategies

One item or one line per trip „ Big

„ Sorting or consolidation is needed later

One order per trip

20 1 3 6 1 No … 5 4 3 2 1 Name Sku ID 4/14/2005 Picking strategies

A batch of orders per trip „ Sort while pick or sort after

6 1 No 2 1 Name Sku ID 2 6 1 No 3 2 1 Name Sku ID

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Picking strategies

A portion of an order (zoning) „ Too big

„ For faster response

„ Consolidation while picking or later … 20 19 18 17 16 15 14 13 12 11 10 9 8 7 20 1 3 6 1 No 6 5 4 3 2 1 Name Sku ID Picking strategies

A portion of many orders (batching + zoning)

„ Economy of scale „ Higher pick density

„ Sorting while picking or sort after 19 18 17 16 15 14 13 12 11 10 9 8 7 20 1 3 6 1 No 6 5 4 3 2 1 Name Sku ID 17 16 15 14 13 12 11 10 9 8 7 20 1 3 6 1 No 6 5 4 3 2 1 Name Sku ID 16 15 14 13 12 11 10 9 8 7 20 1 3 6 1 No 6 5 4 3 2 1 Name Sku ID

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Travels

Pick one at a time

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One order at a time

„ Travel: down „ Search: no change

„ Pick: may have some change due to handling „ Put: may have some change

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Batch picking: multiple-order–one-picker

„ Travel: down „ Searching: not much „ Picking: not much „ Putting:

„ up if sorting on the tour

„ no change if sort later but sorting is required downstream

Almost always good for single line orders

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Batching picking with push carts

Pick to order specific containers, no sorting is required afterwards

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Time based batching: wave picking

Many DCs organize batches based on time window

„ Truck/ship/train departure times „ Shifts „ Cycle times „ Delivery requirements Designations „ Macon wave „ 10 AM wave „ Yellow wave

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Zone picking: one-order-multiple-picker

Benefit/drawback

„ Travel: not much change „ Search: down

„ Pick: no change „ Put: no change

„ Less training, higher accuracy

Zone picking examples

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Batching + Zoning

Very useful in regional distribution centers that supply many stores

Benefit/drawback

„ Travel: down „ Search: down

„ Pick: can go down with sophisticaded design. „ Put: down because sorting is normally later

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Order picking strategy: fast pick area

„ Travel: down in pick area „ Search: not much

„ Pick: may reduce if more convenient „ Put: similar

„ Require replenishment or double handling

Reserve Forward/

Fast pick

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Forward/reserve

The forward takes convenient locations „ Near the shipping

„ At floor level „ Near conveyor

The reserve takes less convenient locations „ Far away

„ Higher levels that require special equipment for picking Forward requires

„ Quick search „ Easy management „ Often dedicated storage Reserve requires

„ Space utilization

„ Often shared or randomized storage

„ The share may be restricted to a special area, like one rack - hybrid

A pick/reserve module

The pick at the bottom Reserve above

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Pick from pallet in a rack module

Fast pick from front

Pick from reserve in the back Replenish from back

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Pick from reserve

Requires expensive equipment

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Pick from pallet to conveyor

Finding skus and volume for fast pick area

Engineering for fast pick area „ Which sku should go to fast pick are

„ How much if know number of skus to share know number of volume?

n no. of skus in fast pick

fi flow vol/year, m3/ year (month) pi pick frequency, picks / year, cpo_i cubic per order, m3/ order,

vi vol of restock to fast pick area of i, m3/ restock V total volume available in fast pick

cr cost of restock, $/restock (assuming constant) s savings of a pick: fast pick vs. reserve.

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Fast pick calculatoin

Fast pick priority, descending order of

i i

cpo

p

=

ciency

Labor Effi

E.g. Please prioritize the claim to fastpick area

1 33333 0.006 0.1 0.3 0.1 400 200 I 4 1563 0.256 0.8 0.4 0.4 800 400 H 5 941 0.85 0.8 1.0 1.0 850 800 G 9 20 5 1.0 1.0 2.0 250 100 F 7 289 0.864 0.6 0.6 0.6 1000 250 E 8 111 0.45 0.5 0.5 1.0 90 50 D 6 694 0.72 1.0 0.8 0.6 750 500 C 3 4322 0.2314 0.5 1.5 0.25 1234 1000 B 2 5556 0.45 0.5 1 0.5 4500 2500 A Priority Efficien cy^2 Cpo VB/A H E W D L C No/mth B Picks/ mth A Sku

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Fast pick volume assignment, nskus, vol V

Equal volume

Equal time

Optimum with respect of total cost n V vi = V f f v _n j j i i

∑

∑

Consider 2 skus. The flows are 16 and 1 m3/ yr. They are

to share 1 m3 storage in fastpick.

Equal Space Equal time Optimal V f/v v f/v v f/v A 0.5 32 16/17 17 4/5 20 B 0.5 2 1/17 17 1/5 5 Total 1 34 1 34 1 25

Discussions

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Order picking summary

The most important operation in a DC

Try to reduce time for travel, search and others Strategies

„ Storage and handling „ Slotting

„ Batching „ Zoning

„ Forward/reserve

„ Technologies (to follow)

„ Conveyors

„ Pick to light (voice), put to light

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Order picking review questions

What is pick list?

What are the order picking strategies?

Are the priorities for slotting and fastpick the same? What strategy is suitable for which type of orders? What is one of the most important direct efficiency objectives in a DC?

Order Picking Technologies

Chen Zhou Fall, 2008

Popular technologies that assist order picking

Pick to light and put to light Pick to voice

“A” frames

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Conveyor

Conveyors

„ Transport

„ Buffer: smooth flow and improve

utilization

„ Extends the good locations

throughout the facility

„ Can yield very high throughput

Important for high throughput systems, more and more popular in US, often miles to tens of miles in a facility

Requires significant investment NorthEAST

CENTRAL SOUTH WEST Satellite Merges Final Merge Main Merge : Accumulation ‘A’ ‘B’ ‘C&D’

Sortation Reciculation Zone for Pick Crossdocked items Sorter Spurs How to draw economic terrain contours 4/14/2005

Schematic of a picking zone

Receiving docks

Sort to shipping docks Pick module Forward

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A graphical view of a pick module

Restock _pick

pick

pick Restock

Pick to light in station lighting

Reduce search time Increase accuracy

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Put-to-light

Present one sku to the picker Scan the sku

Lights associated with order containers will come on Put items into light indicated boxes

Put a

s indic_ated

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Differences between pick to light & put to light

„ Skus are stationary and wait to be picked „ Orders triggers the light

Put to light

„ Orders are batched and wait „ Sku triggers the light

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Application example

A DC has two types of products

„ Staple „ Flow through

Sales would try to convince you their technology is best for both

What do you think?

Pick to voice

Activate voice instructions for the picker

Picker pick and place into the order container

Picker confirm picking complete verbally

No Sorting is required in this example

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Comparison of pick to light and pick to voice

„ Cost

„ Accuracy

„ …

Voice: number of players required is proportional to Light: number of lights required is proportional to Voice: Serial media

Vision: Parallel media

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Automated picking with A - Frame

A frame Automated dispensing

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Automated order fulfillment initiation

Container types Labels and tracking Sorting Manual Barcode directed Vision directed High speed sorters

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Sorting: High Rate Tilt Tray

12,000 items/hr. Unit sorter

Can sort to two sides

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High speed conveyor sorters

Shoe sorter Roller sorter

Other Outbound Operations

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Warehousing review questions

What does SLP stand for and what does it involve? What is the default measure of distance between activities in typical software?

What is the most direct quantitative measure of operational efficiency in layout problems?

Are you comfortable with equal distance contours?

Warehousing intro

What are the purposes of a warehouse (DC)? What are the main operations in a warehouse? Inventor positioning considerations

What are the direct and concrete objectives in a warehouse?

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Warehouse operations

What are some of the material movement equipment used? What are categories of loads moved?

What are the storage methods?

How do you measure the storage methods?

What factors are the most important in deciding an sku’s location? What are the advantages of carousel vs. bin shelving?

What is the advantage of flow racks (pallet or case)?

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Order picking

How do storage strategies affect order picking? What are the order picking strategies?

What strategy is suitable for which type of orders? What are some of the technologies used to improve accuracy and speed?

What does conveyor achieve in a DC?

What are the pros and Cons of pick to light, put to light and pick to voice?

What is one of the most important efficiency objectives in a DC?

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Wal-Mart DC Examples

Chen Zhou Fall, 2008

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Port DC and RDC for Wal-Mart

Pallets are separate, some cases contain multiple skus Fast movers are in pallets

Comments 400 500 People ~ 100 cases/man hour 45 cases/man hour Productivity 15,000/hour 6,250/hour Throughput Support 85 stores Support RDCs and stores

Function

5,000 3,000

Skus ~

1.3 mil ft2

2 mil ft2_{(35 football fielsds)}

Size RDC Port DC Measure 4/14/2005 Wal-Mart DC

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Overview of port DC and RDC

Port DC

Goods come in mostly in cases in containers

Palletization Storage

„ Pick area: shared slots in zones in

pallet racks

„ Reserve: tier racks, deep lane

storage, floor stacking, high density difficult to pick Picking

„ Pallets

„ Cases

RDC

Goods comes in from „ Port DC „ Manufacturers „ Other RDCs Depalletization/palletization Storage „ Racks „ Staging Picking „ Cases „ Break pack „ 23 miles of conveyors Robotic de-palletizer

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Port DC case picking

Order -> Barcode -> pallet(s),

An associate place the pallet into pick area

Picker drives a fork lift picks cases in that aisle to the pallet, scan the case and the pallet

Once completed, a pallet truck driver is informed to move the pallet to the dock

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Order picking schematic in port DC

Vertical economic terrain

Pallet picking vs. case picking

„ Slow moving takes better locations

Separation of picking and transporting

4/14/2005 Lagrange DC Operation Material Flow Main Merging (16 to 4) Mini Merging (4 to 2) Sorter Staple Goods (By Conveyor) Distribution Goods (By Conveyor) Distribution Goods

(By Pallet Truck) All Goods (By Conveyor) Staple Goods (By Pallet Truck)

Pick module in conveyorized system

Receiving docks

Sort to shipping docks Pick module Forward

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Order picking

Pick to conveyor

„ Stack of bar code labels

„ Place the label on carton, put the carton on conveyor

„ Base pick rate: 450 cases/hour, or 8 second/case, including other times. „ Conveyor capacity: 20,000 cases/hour

Break pack

„ People to storage „ Pick to light „ Put to light

„ Wal-Mart do not open a case unless the orders will require its entire content

„ What does this mean in fill rate and inventory level? „ What will be the alternatives?

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Discussions

What additional “engineering” is needed to achieve high pick rate?

„ Sequence in SKU sequence along the path „ Use large time windows to “batch” orders

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